USDCHF Analysis: Selling off from 0.9850?
Last Thursday’s signals were not triggered, as none of the key levels were reached during that day’s trading session.
Today’s USD/CHF Signals
Risk 0.75%.
Trades must be entered between 8am and 5pm London time today only.
Short Trade Ideas
Short entry following a bearish price action reversal upon the next touch of 0.9850 or 0.9909.
Put the stop loss 1 pip above the local swing high.
Move the stop loss to break even once the trade is 20 pips in profit.
Remove 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to run.
Long Trade Idea
Long entry following a bullish price action reversal upon the next touch of 0.9815.
Put the stop loss 1 pip below the local swing low.
Move the stop loss to break even once the trade is 20 pips in profit.
Remove 50% of the position as profit when the price reaches 20 pips in profit and leave the remainder of the position to run.
The best method to identify a classic “price action reversal” is for an hourly candle to close, such as a pin bar, a doji, an outside or even just an engulfing candle with a higher close. You can exploit these levels or zones by watching the price action that occurs at the given levels.
USD/CHF Analysis
I wrote last Thursday that although we had seen the price move down further, initially due to the sell-off from the long-term resistant area at 0.9950, and then later due to the general weakening of the Dollar after the Fed signalled a more dovish approach to interest rates ahead, the price remained well within its long-term range and had no momentum left, so I had no directional bias today. This was a relatively good call as the price reversed during the early part of Thursday before falling and selling off again.
The U.S. Dollar remains weak and the Swiss Franc has long-term strength, so it could be argued there is a little bearish momentum. However, the price is quite close to support, and is trading within a long-term range, which makes me nervous to have any directional bias, even though sellers have just stepped in at 0.9850.
The most likely scenario today is a continued fall to anywhere between 0.9840 and 0.9815, with a bullish reversal happening somewhere in that zone, but I do not think we will see a lot of price movement anyway.
There is nothing of high importance due today regarding either the CHF or the USD.